A labor leader's view of welfare "reform"

By Blair Bertaccini, in People's Weekly World,25 February, 1995

Blair Bertaccini is president of the Greater Waterbury Central
Labor Council. He presented the following testimony to the Human
Services Committee of the Connecticut State Legislature on Feb. 9
during a hearing to consider issues of "welfare reform."

I am here today to speak about some economic trends which should
be addressed when dealing with the issue of welfare reform. The
supposed goal of many of these proposals is to get welfare
recipients back into the labor force. This would be fairly simple
if we had a full employment economy.

The AFL-CIO estimates that the job gap in the U.S. is about 13
percent -- this figure includes those who are officially
unemployed, which in Connecticut is somewhere between 5 and 6
percent, part-time workers who want full-time jobs andthose
discouraged workers who have been jobless for so long they have
stopped actively looking for work.

Most people who go from welfare into the job market will get jobs
at or near theminimum wage. A single mother with two children
working full-time at a minimum wage job will not even get above
the poverty line. Moreover, real wages for all workers continue
to fall. U.S. Labor Department studies show that average
hourlywages for non-supervisory jobs have fallen to their lowest
level since 1964. In 1993, 16 percent of full-time workers had
earnings below the poverty line.

We can get people off welfare by enacting some programs which do
not even deal directly with the welfare system. One would be to
raise the minimum wage. A study of New Jersey, which has $5.05
minimum wage, showed that employment in lowwage businesses
actually went up after the minimum wage was raised. We need to
restore the minimum wage to a level that one wage earner can
support a family above the poverty line.

Another program to attract people off the welfare rolls would be
a massive public works jobs program. Our state and our nation
need projects such as pollution control, renovation and
construction of housing in our cities, mass transit systems, new
schools, and neighborhood health clinics, just to name some. The
government should set up programs to train and put people to work
in such projects at prevailing wage rates. If you are serious
about getting people to work you should offer them real jobs at
good wages not make-work jobs just toget a welfare check.

I know the common reply to such proposals-there is no money for
such programs, let alone to run current government budgets. But
this is not true.

In the 1980s the increase of total salaries of people making more
than $1 million per year went up 2,184 percent, for those making
between $200,000 and $1million the increase was 697 percent. The
1986 Tax Reform Act cut taxes for those making over $500,000
between 31 and 34 percent depending on income. Since the early
1950s the share of total federal tax revenues paid by
corporations hasfallen from 39 to 17 percent.

The Clinton tax changes have only slightly changed this
situation. What has thisresulted in? By 1993 more than 48 percent
of the nation's income went to the topfifth of all households and
20 percent went to the top 5 percent, in both instances the
highest levels since records began! By 1989 the top 4 percent
families and individuals earned as much as the bottom 51 percent.

After getting all this loot what do the rich and the corporations
do with it? Dothey invest it and create lots of new good paying
jobs? No, they do just the opposite. They lay off workers and
make those who are left work more and more toearn less and less.

What we should really be talking about is legislation to increase
taxes on theseirresponsible wealthy and put the money to good use
in a living wage jobs program. I guarantee that if you did this
you would see the welfare rolls decline significantly, and
disappear if you also enacted programs of low cost day care and
universal medical care.

It's time to stop scapegoating victims of an economic system run
amok and look at some real solutions that will create a better
Connecticut for all of us.